Hello every one, have been a subscriber of the newsletter and thanks for everyone for all your valuable posts.
I am planning to buy a decent sized block of land with a very old house, with one of my friends and have plans to build two town houses in that land. could any one of you please please give me some advice on how to proceed ? This is what I have thought of doing initially, but I am not really sure If I am on the right path.1. find piece of land (where the selling date is little bit flexible)
2. get advice from council, if there are any permission constraints for building town houses in that area
3. get advice from architect, if its feasible
4. talk to bank and get the approvals
5. start bargaining for land
Really appreciate if some one can help me in this regards.
Cheers
DaveHi Dave,
It is really worth doing! You need to do as much research as possible before you even start looking at anything. This research involves picking an area for instance and then "crunching the numbers". Nobody develops for free, so you need to make sure that the area you pick has a easy chance of developing, inexpensive building and easy, profitable selling.
The beginning would be phone calls and stacks of em. You can pick a property (I will assume you have already seen something that has sparked your interest). Ring the council ask about subdivision, ask about restrictions, ask anything even if they treat you like an idiot who cares! You have to start somewhere.
Google architects, ring and find out how much they charge to draw plans and working drawings, how much they will charge to take the application to council etc. There are some great guys on this site who are more than happy to help you get started with tips and ideas. They can advise you on what can go on a block maybe 2, maybe 3. maybe single story, maybe double.They can also help you to cost for building and introduce you to builders.
Do you have cash? You will need cash to pay for application fees, drawings, interest while you are holding the property (meet shortfall in rent, or pay when property is demolished and new dwellings being built) demolition etc.
Talk to bank get a pre approval or no then go shopping.
Search through the forum for subdivision etc and have a good read. Good material is also API small development guide and Ron Forlee Residential development book (where are my royalties I have plugged this book to death!!!!)
Then when you have researched the crap outta this thing then get cracking and do it! No ifs no buts no maybes. Get the big picture set in your head and go for it.
I never really saw the house on our block I only every saw the ghostly outline of the 3 units that are there now.
Good luck!
D
DWolfe | www.homestagers.com.au
http://www.homestagers.com.au
Email MeYou need to work backwards
Final expected sales price of finished development – total development costs – purchase price = expected profit
So cost of development application, Cost of demolishing old house, Cost of putting in services, Cost of building two properties, cost of landscaping, cost of finance while project being done (interest)
You need to know the costs to work out if feasible purchase and what price you can afford to buy it at and still make a profit.
Bank will want to know this also.Here are some of the tips in buying a property:
1. Do some research – research on the surrounding areas and how much property in the are recently sold.
2. Prepare yourself financially
3. Make a structure survey
4. Be patient
5. Location is just as important as property
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